The Nigerian Electricity Regulatory Commission (NERC) has imposed a ₦1.69 billion fine on the Abuja Electricity Distribution Company (AEDC) for overbilling its customers.
This sanction follows AEDC’s non-compliance with NERC’s order on capping estimated billing practices for electricity consumers.
The fine is outlined in NERC’s September 2024 Supplementary Order, documented as ‘Order NERC/2024/114,’ and was issued after a thorough investigation into AEDC’s billing practices. According to the document, “Pursuant to the Commission’s order NERC/2024/04 on non-compliance with the capping of estimated billings, and subsequent petition hearings and data further provided by AEDC, the commission approved the deduction of N1.69bn from the total annual OpEx of AEDC effective September 2024, being 10 per cent of the overbilled amount by AEDC for the period covering January-September 2023.”
The investigation revealed that AEDC had overcharged customers from January to September 2023, prompting the fine, which is 10 percent of the overbilled amount.
The penalty also includes adjustments to AEDC’s revenue requirements and tariffs to reflect this overbilling.
In addition to the financial penalty, NERC has issued several directives aimed at ensuring compliance and improving AEDC’s service delivery.
The order includes specific instructions to AEDC regarding monitoring electricity supply, particularly to Band A feeders, where high service levels are expected. NERC emphasised, “Where AEDC fails to deliver on the committed level of service on a Band A feeder for consecutive two days, AEDC shall on the next day by 10am publish on its website an explanation of the reasons for the failure.”
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NERC also mandated AEDC to procure a minimum of 61MW of embedded generation, with at least 30MW sourced from renewable energy. This measure is required to boost the reliability of electricity supply within AEDC’s service area.
The procurement must be completed by April 2025, with NERC noting that this step is essential for AEDC to meet its commitments under the Service-Based Tariff framework. NERC stressed that it is “necessary to meet AEDC’s service delivery commitments under its Service-Based Tariff framework.”
AEDC is also required to compensate customers on Band A feeders if they fail to deliver up to 20 hours of supply but exceed 18 hours of service. The order stated, “AEDC shall make appropriate compensation to the affected customers in Band A feeders listed in Appendix 3 for failure to deliver up to 20 hours of average supply but more than 18 hours of average supply.”
The September 2024 Supplementary Order, which will remain in effect until a new tariff review is issued, reinforces NERC’s commitment to holding electricity distribution companies accountable and ensuring fair treatment for consumers.
